2 NXT cash + (aveprice of NXTautoDAC) * .15
.3 NXTautoDAC
.2 NXTventure
James
hi James,
probably you may want to break this down a bit further into more details so that people can catch it here.
also, how do you plan to take a snapshot of Nxtventure distribution?
Not sure if you are familiar with securities analysis,but the basics are that a security is worth the lifetime future cashflows it will get. Of course, there are things like zero coupon bonds that pay no interest and just lump sum at the end,but lets stick to the model of a security that costs X and in return you will get sum(Y0 + Y1 + ... ) where Yi is the value of what you get each year. Clearly the time horizon is critical as without a cutoff it will become infinite, which is clearly wrong. So, an approximation is made where you take one years worth of profits and multiply it by this PE (price earnings multiplier)
Companies that are in mature competitive industries get the lowest PE, companies that are in high growth high profitability industries get the highest multiples. PEs in the multiple hundreds are possible for premium companies like google before they have taken over the world. The market projects how big they will be and how much profits they will be making in the future, discount it for competitive and unknown factors and decides on what the PE should be.
Here in crypto land we can safely assume is is going to be high growth industry, so the multiples should be more than an old steel factory. Now there are plenty of risks, especially for longevity, so lets throw out the triple digit PE. More than single digits, less than three digits. I think a reasonable PE would be 20. That is super low for a mega growth industry,but it also factors in the risk. Basically it should be more like 50, 60 or 80 but since things are so new and unproven, I discount things to the more typical PE of 20. It means 20 years of constant profits. But of course, with exponential growth you can hit that in 3 years or so.
Since we are analyzing the price of an asset, lets simplify things by taking the total holdings and dividing by the total number of assets. For example at this moment:
NXTventure: ~3 million NXT, ~350000 NXTautoDAC, ~200000 NXTventure
just look up acct 9190137219092766242 to get the totals. There are one million assets, so this becomes:
3 NXT, .35 NXTautoDAC, .2 NXTventure
The market is still discovering the price of NXTautoDAC. I knew 10 NXT was below market and it is already at 14/15, lets round down and say NXTautoDAC is worth 14 so .35 of that is 4.9 NXT. NXTventure itself is at somewhere between 16 and 31. I dont count the selfbid. Call it 24, so .2 of that is 4.8 NXT
Add the three together and the marked to market holdings of NXTventure is 12.7
This might be analogous to book value. Not actual market value but the number accountants use for tax purposes where you want to have smaller numbers. Also, fundamental investors like to use this as a sort of worst case value. Keep in mind it is not the actual book value, just a marked to market value. The thinking is that if the company just distributed itself out 100% to its holders what is it worth. My estimate is 12.7, round down to 12
What that means is that if the price is 24, half of that is covered by the marked to market + cash value. So the question now becomes is NXTventure properly valued at 24?
Lets see, working backwards using a PE of 20, what this means is that the market is saying that it thinks that in a year NXTventure will produce 12/20 NXT in additional profits per asset. Hmmm. Thats 600,000 NXT of profits for the whole next 12 months. Do you think that is right?
OK, lets go the other way. Let us assume that each month NXTventure will be able to earn 1 NXT per asset in trading profits + assets. That means that over a year the price of 24 means that the PE is 1. ONE? PE of 1. Now I know of some low margin companies that sell for PS (price to total sales not profits) of 2 or 3, but PE of 1 is extremely low.
I really cant give investment advice regarding my own assets and you need to get an independent analysis, preferably your own. However, NXTventure is fairly unique because unlike other growth companies that dont issue dividends, there will be a monthly dividend of that month's listing. The price should zig zag around the ex-dividend date. Let us assume there will be .3 NXTautoDAC per asset at the end of the month and that the price is 15. Well if the first month's dividend is worth 4.5 NXT, what would you estimate the annual amount of dividends to be? What PE do you think NXTventure should get?
Once you objectively analyze this question and do the calculations, you will have a big advantage over the people that dont since you will know how much it is worth, well at least a lot closer than the people that dont do the analysis
James
P.S. I know I cant give any advice about my assets, but I think I can say that I strongly feel that NXTventure is the most undervalued one of them all, if you were to compare them against each other.
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Topic: NXTventure - bringing only the best issues to NXT AE (Read 102604 times)